Common Form 720 Filing Mistakes and How to Avoid Them
Filing Form 720 Without Unnecessary Problems IRS Form 720 is used to report and pay federal excise taxes on certain goods, services and business activities. These may include fuel, communications, air transportation, tires, environmental taxes and other taxable activities. Although it is a quarterly return, mistakes can happen when businesses select an incorrect tax category, enter the wrong quarter or overlook required information. Understanding these common errors can make the filing process much easier. 1. Choosing the Wrong IRS Tax Number Form 720 contains several IRS numbers for different excise tax categories. Selecting the wrong number may cause the tax to be reported under an incorrect activity. Before filing, confirm: The product or service subject to excise tax The correct IRS number The applicable tax rate The quantity, sales amount or other taxable measurement 2. Reporting the Wrong Filing Quarter Form 720 generally follows a quarterly filing schedul...